CHAPTER 3
HR Operations
This functional area, HR Operations, counts toward 38 percent of the Associate Professional in Human Resources (aPHR) exam. Technically, human resource (HR) operations refer to services provided by an HR department to the organization’s operations. It covers a wide range of services including administrative services, recruitment, employee relations, legal compliance, policy development, compensation and benefits, training and development, and safety. These are not all of the possibilities. There may be more or less depending on each organization’s functional values. Smaller organizations may assign someone to be responsible for shared functions. Larger organizations typically have HR responsibilities organized by functions. Added to this is the role of the HR generalist and the HR specialist. The HR generalist is responsible for the day-to-day management of HR operations, which means they manage the administration of the organization’s policies, procedures, and programs.
The last 50 years have seen considerable changes in the delivery of HR services. HR has developed from its early role of a group of industrial relations specialists negotiating terms and conditions of work to today’s business partners working with line management to add value to the company. HR now performs two distinct functions: transformational HR, that is, delivering strategy and change, and transactional HR, dealing with a wide range of administrative and operational tasks in support of the organization.
The Body of Knowledge statements outlined by HR Certification Institute (HRCI) for the HR Operations functional area by those performing early HR career roles are as follows:
Knowledge of
• 01 Organizational strategy and its connection to mission, vision, values, business goals, and objectives
• 02 Organizational culture (for example, traditions, unwritten procedures)
• 03 Legal and regulatory environment
• 04 Confidentiality and privacy rules that apply to employee records, company data, and individual data
• 05 Business functions (for example, accounting, finance, operations, sales and marketing)
• 06 HR policies and procedures (for example, ADA, EEO, progressive discipline)
• 07 HR metrics (for example, cost per hire, number of grievances)
• 08 Tools to compile data (for example, spreadsheets, statistical software)
• 09 Methods to collect data (for example, surveys, interviews, observation)
• 10 Reporting and presentation techniques (for example, histogram, bar chart)
• 11 Impact of technology on HR (for example, social media, monitoring software, biometrics)
• 12 Employee records management (for example, electronic/paper, retention, disposal)
• 13 Statutory reporting requirements (for example, OSHA, ERISA, ACA)
• 14 Purpose and function of human resource information systems (HRISs)
• 15 Job classifications (for example, exempt, nonexempt, contractor)
• 16 Job analysis methods and job descriptions
• 17 Reporting structure (for example, matrix, flat)
• 18 Types of external providers of HR services (for example, recruitment firms, benefits brokers, staffing agencies)
• 19 Communication techniques (e.g., written, oral, e-mail, passive, aggressive)
Laws and Regulations
• Equal opportunity
• Affirmative action
• Sexual harassment
HR professionals provide services throughout the organization that are regulated by one or more of these laws. Managers depend on HR support to be in compliance with a multitude of federal, state, and local laws; rules; and regulations, and this is just the beginning. This would be a good time to review all the laws listed in Chapter 2 for the following:
• Coverage
• Application
• Compliance
Any of these laws may appear on your certification exam as a multiple-choice question. If you have reviewed these laws thoroughly, you will be prepared for them.
HR Functions
Some of the functions of an HR department are personnel sourcing, hiring, training, skill development, benefits administration, and compliance with applicable national, regional, and local laws. In short, HR is responsible for attracting, training, and maintaining the safety of the employees of the company. The following is a more detailed list of HR functions, with a brief description of each:
• Hiring is sometimes used interchangeably with staffing, which does an injustice to the broad scope of activities involved in staffing. Hiring might be thought more specifically as screening the best job candidates, but especially making a formal job offer to the best candidate.
• Staffing and employment Staffing includes a broad scope of activities, including the following:
• Before a new employee is hired to do a job, the job should be clearly designed or defined. A job is a collection of tasks and responsibilities that an employee is responsible for conducting. Jobs have titles.
• Jobs are usually designed by conducting a job analysis, which includes examining the tasks and sequences of tasks necessary to perform the job.
• A task is a typically defined as a unit of work, that is, a set of activities needed to produce some result, e.g., vacuuming a carpet, writing a memo, sorting the mail, and so on. Complex positions in the organization may include a large number of tasks, which are sometimes referred to as functions.
• Note that a role is the set of responsibilities or expected results associated with a job. A job usually includes several roles.
• The job analysis also looks at the areas of knowledge, skills, and abilities (the competencies) needed by the job. Typically, competencies are general descriptions of the abilities needed to perform a role in the organization. Ideally, competencies are even described in terms such that they can be measured.
• Job descriptions are often used to describe a job and include lists of the general tasks, functions, and/or responsibilities of a position, whereas competencies list the abilities needed to conduct those tasks, functions, and/or responsibilities. Typically, descriptions also specify to whom the position reports, qualifications needed by the person in the job, and salary range for the position.
• Staffing is often a subset of the activities in human resource management.
• Employment Employment is an agreement between an employer and an employee that the employee will provide certain services on the job. The work will occur in the employer’s designated workplace. The work is designed to accomplish the employer organization’s goals and mission. In return, the employee receives compensation.
• Co-employment This refers to circumstances in which a worker has simultaneous employment relationships with two or more employers for one work situation. This typically comes into question with contingent workers as the staffing provider and on-site company both assume different portions of the responsibility for an individual’s employment situation.
Co-employment is something that employers cannot afford to get wrong. Here are some things to consider to help avoid co-employment pitfalls:
• Establish clear boundaries. In a co-employment situation, for the staffing provider to be positioned as the primary employer responsible for the worker, there must be clearly outlined roles for each party. All employer responsibilities such as recruiting, pay negotiation, insurance coverage, HR issues, onboarding, and termination must be handled solely by the staffing provider, with the on-site company taking responsibility only for direction and supervision of day-to-day responsibilities. When either party goes beyond their role, it becomes unclear which party is the primary employer and will make determining employment more challenging. Employers must also be sure that contingent workers are identified differently in their organizations to further illustrate their role versus permanent staff at the organization; issuing separate ID badges, having their e-mail addresses look different, and so on further differentiates the two parties and their place within the organization.
• Create a clear and differentiated benefits plan. As organizations put together policies around their benefit offerings, it is important to be as detailed as possible, outlining exactly which type of employees are eligible for benefits. Clearly detail whether or not contingent, contract, and independent workers fall within the plan’s remit. This sort of clarity can help you avoid questions and litigation in the future. In addition, another effective strategy is having contingent workers sign a waiver that they will not claim access to benefits from their assignment company at any point.
• Stay current. Knowing the latest in labor laws and government regulations can be a challenge. It is critical to select a staffing provider that can offer expertise and guidance around co-employment and other labor laws that can affect your business, both positively and negatively, to help mitigate risk.
EXAM TIP Staffing, usually called employment, involves three activities: human resource planning, recruitment, and selection.
Employee Relations
This is the body of work concerned with maintaining employer-employee relationships that contribute to satisfactory productivity, motivation, and morale. Employee relations offers consultation, facilitation, and resolution strategies for workplace issues. Employee relations assists in communications between employees and supervisors, corrective action and planning, disciplinary actions, and explanation and clarification of policies and procedures.
Records Management
This refers to a set of activities required for systematically controlling the creation, distribution, use, maintenance, and disposition of recorded information maintained as evidence of business activities and transactions. The key word in this definition is evidence.
Compensation and Benefits
Simply, this is the monetary value you give to your employees in return for their services. In the book Human Resource Management, Gary Dessler defines compensation as follows: “Employee compensation refers to all forms of pay going to employees and arising from their employment.” An example of good pay management is the implementation of wage guidelines that avoid the practice of allowing red circle rates of pay (paying wages above the range maximum) or green circle rates of pay (paying wages below the range minimum).
Training and Development
This is considered a function concerned with organizational activity aimed at bettering the job performance of individuals and groups in organizational settings.
Training is the process of teaching new employees the basic skills they need to perform their jobs. Programs that are more present-day oriented and focus on an individual’s current jobs, enhancing specific skills and abilities to immediately perform their job, is called training.
Development is the act of encouraging employees to acquire new or advanced skills, knowledge, and viewpoints by providing learning facilities and avenues where such new ideas can be applied.
Health, Safety, and Security
As defined by the World Health Organization (WHO), “occupational health deals with all aspects of health and safety in the workplace and has a strong focus on primary prevention of hazards.”
HR Research
This is simply a kind of research conducted in the field of human resources. HR research also offers detailed analysis on the current development and management issues with the real-life case studies to enable the formulation and implementation of the strategy practice within the current organization.
HR Generalists and Specialists
HR professionals generally take one of two career paths: specialist or generalist. As the term implies, the human resource specialist develops expertise in a specific HR discipline. The generalist, on the other hand, is the HR jack-of-all-trades. The question often arises as to which path is best for you.
HR generalists have a broad spectrum of responsibilities that will require them to draw upon everything they’ve learned in a master’s program in human resources. As its name suggests, duties are comprehensive and diverse and may include the following:
• Staffing and recruitment
• Employee training and development
• Compensation and benefits
• Personnel policies and procedures
• Employee relations
• Workplace safety and security
The following is a sampling of some types of specialist HR jobs:
• Workforce planning and employment specialist
• HR development specialist
• Total rewards specialist
• Employee and labor relations specialist
• Risk management specialist
• Metrics management specialist
• Human resource information systems specialist
• Global human resources specialist
• Organizational development specialist
After receiving a human resource management degree, many human resource graduates begin their careers as human resource generalists, discover an area that’s particularly interesting to them, and then pursue it as a human resource specialist. By comparison, HR specialist jobs require a tremendous attention to detail, and you’ll be viewed as an authority in a particular field.
HR Manager, Director, or Officer
In businesses large or small, those with multiple layers of authority within the HR department might have several different positions and classifications to fill. The positions range from HR representatives, who represent the lowest level of HR positions, to chief HR officers, who are members of the executive leadership team. Title doesn’t always determine the layers of hierarchy in the department. Small companies sometimes give their sole HR department contact the HR director title, even if they don’t have employees to supervise.
HR Support System
HR support systems are the various activities, programs, and initiatives used by organizations to assist in the development of human resources. In general, these systems, which are typically operated by an organization’s HR department, include training and development, performance appraisal and feedback, career management, formal mentoring, and various types of employee services and assistance programs. The primary goal of these activities is to assist in the growth of the employee as a means of improving individual and organizational performance. In addition, these activities are intended to enhance employee work attitudes and increase employee commitment to the organization.
HR Education and Certification
Numerous programs offer education and professional certification for the individual, ranging from academic programs offered in colleges and universities to various certification programs offered by professional HR organizations. Some of these programs include the following:
• Human resource certificate programs Certificates are the easiest credential to achieve and can help you gain practical, tactical knowledge about day-to-day HR issues. Typically, these one- or two-day events are a great way to learn about new technologies, such as online psychological screenings and corporate education programs. They’re also a good way to explore a potential specialty. Certificates in state regulations and mandates are valuable because they let employers know you are familiar with important state government requirements.
Most certificate programs are open to anyone; degree and certification programs have stricter admissions requirements.
• Human resource degree programs Undergraduate and graduate degree programs in HR offer deeper learning opportunities but tend to focus more on theory than practical skills. According to the Society for Human Resource Management (SHRM), there are more than 260 HR-focused undergraduate degree programs at U.S. colleges and universities.
Because an understanding of business operations is crucial for those wanting to advance to a human resource management role, experts say a master’s of business administration (MBA) carries the most weight among advanced degree programs. SHRM estimates that U.S. universities offer more than 120 graduate programs, including MBAs, that feature concentrations in human resources.
• Human resource certifications The most valuable educational option is certification because it truly demonstrates mastery of the subject. The three main designations in the HR profession granted by the HR Certification Institute (HRCI®) are
• Professional in Human Resources (PHR), which focuses on operations and is best for people early in their careers
• Global Professional in Human Resources (GPHR), which is designed for people who manage HR in multiple countries
• Senior Professional in Human Resources (SPHR), which covers strategic issues and is designed for experienced professionals
The Society for Human Resource Management (SHRM) has developed its own competency-based certification program. Designed for early-career and senior HR professionals, these certifications are based upon SHRM’s rigorously validated competency model composed of the knowledge and behavior needed to succeed in human resources management.
• SHRM’s certification program includes two certifications:
• SHRM Certified Professional (SHRM-CP) for HR professionals who implement policies and strategies, serve as points of contact for staff and stakeholders, deliver HR services, and perform operational HR functions
• SHRM Senior Certified Professional (SHRM-SCP) for HR professionals who develop strategies, lead the HR function, foster influence in the community, analyze performance metrics, and align HR strategies to organizational goals
HR Networking
For many HR professionals, networking is assumed to relate to the activity of external consultants who need to network to find work. It isn’t something that they think they do or indeed need to do. This is not a good assumption when the ability to perform your HR job well is an underlying expectation of competency. HR professionals need to be far more than just competent; the ability to build and nurture relationships, have advocates, build reputation and credibility, demonstrate openness and trust, and implement fantastic interpersonal skills is a must. This is everything that a good professional networker takes for granted.
There are a number of reasons why HR professionals should network within and outside of their organization. These include the following:
• Do your job well
• Build reputation and credibility
• Gather advocates
• Facilitate trust
Networking can do wonders for your company’s performance and your career. There are many ways to network, but the method that will work best is one that is value driven, has integrity, and is open and transparent. Enabling others to succeed, as well as having a strong reputation and credibility, will enable you to attract advocates, thus enabling you to become a more effective HR professional.
Organizational Accountability
This is the obligation of an individual or organization to account for its activities, accept responsibility for them, and disclose the results in a transparent manner. It also includes the responsibility for money or other entrusted property.
Multifunctional HR Department
The typical multifunctional HR department deals with the following six functional areas:
• Recruitment
• Employee relations
• Compensation and benefits
• Compliance
• Safety
• Training and development
An effectively run multifunctional HR department provides the organization with structure and the ability to meet business needs through managing the company’s most valuable resources, its employees. Several HR disciplines, or areas, are involved in running an effective multifunctional department, but HR practitioners in each discipline may perform more than one of the more than six essential functions. In small businesses without a dedicated HR department, it’s possible to achieve the same level of efficiency and workforce management through outsourcing HR functions or joining a professional employer organization.
Sole HR Practitioner
Those who manage an HR department of one are some of the hardest working in our industry because they must cover everything, including recruiting, benefits, training, employee relations, strategic planning, and more. Putting out daily HR fires can make it difficult to set aside the time it takes to focus on bigger-picture tasks. One of the biggest challenges is balancing both the administrative side of human resources and the long-term strategy. What will drive the most significant impact is the strategy, but small tasks must get done to accomplish the larger goals. While a sole HR practitioner needs to be ready to switch gears at a moment’s notice, they can also block off time during the week to deal with specific tasks. Not everything has to be handled right away.
It is important to read about the latest HR and employment law trends. This is especially true for sole practitioners. Many employment law firms have blogs and also provide updates through e-mail newsletters. There are also countless free and low-cost webinars and in-person seminars put on by HR professionals and employment attorneys.
It is important for a sole HR practitioner to know their limits and ask for help when things get challenging. Consider hiring an HR consultant that can be on call to help. When in a serious or complex pickle, always call your employment attorney. Even small businesses should have a relationship with an employment attorney in case a situation is big enough to warrant legal help.
HR Call Center Operations
Human resource call centers are set up to help employees access human resource information, such as benefit and retirement packages and payroll. The call center is cost effective for companies by serving as a one-stop-shop to answer employee questions and may help increase worker productivity by decreasing the time spent by employees looking for information in a variety of places. For a small business, this may help alleviate the stress of administrators by delegating these questions to a call center so administrators can focus on more demanding tasks.
Call center calls are typically prescreened through an automated system that redirects calls to certain paths based on the caller’s selection or area of concern. The prescreening process controls the lines for situations where there may be a lot of callers. This also allows the caller to be directed to the most appropriate HR professional who specializes in a particular area. An HR call center tracks how many callers and how frequently callers choose certain prerecorded answers and particular prescreening paths, such as the location of the HR department office.
Organizational Strategy
An organizational strategy is the sum of the actions a company intends to take to achieve long-term goals. Together, these actions make up a company’s strategic plan. Strategic plans take at least a year to complete, requiring involvement from all company levels. Top management creates the larger organizational strategy, while middle and lower management adopt goals and plans to fulfill the overall strategy step by step.
Mission
A mission is a written declaration of an organization’s core purpose and focus that normally remains unchanged over time. Properly crafted mission statements
• Serve as filters to separate what is important from what is not
• Clearly state which markets will be served and how
• Communicate a sense of intended direction to the entire organization
A mission is different from a vision in that the former is the cause and the latter is the effect; a mission is something to be accomplished, whereas a vision is something to be pursued for that accomplishment.
Vision
This is an aspirational description of what an organization would like to achieve or accomplish in the mid-term or long-term future. It is intended to serve as a clear guide for choosing current and future courses of action.
Values
Values are important and lasting beliefs or ideals shared by the members of a culture about what is good or bad and desirable or undesirable. Values have a major influence on a person’s behavior and attitude and serve as broad guidelines in all situations. Some common business values are fairness, innovation, and community involvement.
Goals and Objectives
Objectives define strategies or implementation steps to attain the identified goals. Unlike goals, objectives are specific and measurable and have a defined completion date. They are more specific and outline the “who, what, when, where, and how” of reaching the goals.
Organizational Culture
This is a system of shared assumptions, values, and beliefs, which governs how people behave in organizations. These shared values have a strong influence on the people in the organization and dictate how they dress, act, and perform their jobs.
Tradition
Tradition is an inherited, established, or customary pattern of thought, action, or behavior (such as a religious practice or a social custom). It is a belief or story or a body of beliefs or stories relating to the past that are commonly accepted as historical though not verifiable.
Unwritten Procedures
These are behavioral constraints imposed in organizations or societies that are not voiced or written down. They usually exist in unspoken and unwritten format because they form part of the logical argument or course of action implied by tacit assumptions. Examples involving unwritten procedures include unwritten and unofficial organizational hierarchies, organizational culture, and acceptable behavioral norms governing interactions between organizational members.
Confidentiality
Personal information shared with an attorney, physician, therapist, or other individual generally cannot be divulged to third parties without the express consent of the client. While confidentiality is an ethical duty, privacy is a right rooted in common law.
Privacy
In general, privacy is the right to be free from secret surveillance and to determine whether, when, how, and to whom one’s personal or organizational information is to be revealed. Specifically, privacy may be divided into four categories:
• Physical Restriction on others to experience a person or situation through one or more of the human senses
• Informational Restriction on searching for or revealing facts that are unknown or unknowable to others
• Decisional Restriction on interfering in decisions that are exclusive to an entity
• Dispositional Restriction on attempts to know an individual’s state of mind
Employee Records
Employee records are defined to include the application for employment and records that are used or have been used to determine an employee’s qualifications for promotion, compensation, termination, or disciplinary action.
Company Data
There are four different areas a company can gather internal data from: sales, finance, marketing, and human resources. Internal sales data is collected to determine revenue, profit, and the bottom line. The finance department supplies cash flow reports, production reports, and a budget variance analysis. Human resource data is information relative to the company’s employees.
Personal Data
According to the law, personal data means any information relating to an identified or identifiable individual; an identifiable person is one who can be identified, directly or indirectly, in particular by reference to an identification number (e.g., Social Security number) or one or more factors specific to his or her physical, physiological, mental, economic, cultural, or social identity (e.g., last name and first name, date of birth, biometrics data, fingerprints, DNA, etc.).
Business Functions
EXAM TIP One of the common complaints of executives is that human resource people do not understand the business; they do not know what is required to make a profit or how to speak the language of business.
A business function is defined as any set of activities performed by the department that is initiated by an event, transform information, materials or business commitments, and procedures and output (e.g., order fulfillment, invoicing, cash management, manufactured batch, customer response tracking, regulatory submissions, etc.).
Finance and Accounting
1) The accounting department is part of a company’s administration that is responsible for preparing the financial statements, maintaining the general ledger, paying bills, billing customers, managing payroll, doing cost accounting, performing financial analysis, and more. 2) The financial function is the part of an organization that manages its money. The business functions of finance typically include planning, organizing, auditing, accounting for, and controlling its company’s finances. The finance department also usually produces the company’s financial statements.
Operations
Operations management refers to the administration of business practices to create the highest level of efficiency possible within an organization. It is concerned with converting materials and labor into goods and services as efficiently as possible to maximize the profit of an organization. The outcome of business operations is the harvesting of value from assets owned by a business. Assets can be either physical or intangible. An example of value derived from a physical asset such as a building is rent. An example of value derived from an intangible asset, such as an idea, is a royalty.
Sales
The sales department can be defined as the division of a business that is responsible for selling products or providing services, according to Reference.com. It is also known as the sales division and is partnered with marketing in a reciprocating relationship within the world of business.
Marketing
Marketing is the management process through which goods and services move from concept to the customer. It includes the coordination of four elements, called the 4 Ps of marketing:
• Identification, selection, and development of a product
• Determination of its price
• Selection of a distribution channel to reach the customer’s place
• Development and implementation of a promotional strategy
Business Reporting
A business structure, otherwise known as an organizational structure, defines how activities such as task allocation, coordination, and supervision are directed toward the achievement of organizational aims. It can also be considered the viewing glass or perspective through which individuals see their organization and its environment.
There are four main types of organizational structure: flat, functional, divisional, and matrix structure.
• Flat A flat organization (also known as a horizontal organization or delayering) has an organizational structure with few or no levels of middle management between staff and executives. The advantages of this type of structure are it elevates the employees’ level of responsibility in the organization. It removes excess layers of management, which improves the coordination and speed of communication between employees. Fewer levels of management encourage an easier decision-making process among employees. The disadvantages are employees often lack a specific boss to report to, which creates confusion and possible power struggles among management. Flat organizations tend to produce a lot of generalists but no specialists. The specific job function of employees may not be clear. A flat structure may limit the long-term growth of an organization; management may decide against new opportunities in an effort to maintain the structure. Larger organizations struggle to adapt the flat structure, unless the company divides into smaller, more manageable units. Eliminating the salaries of middle management reduces an organization’s budget costs.
• Functional A functional structure is set up so that each portion of the organization is grouped according to its purpose. In this type of organization there may be a marketing department, a sales department, and a production department. The functional structure works well for small businesses in which each department can rely on the talent and knowledge of its workers and support itself. One of the drawbacks to a functional structure is that the coordination and communication between departments can be restricted by the organizational boundaries of having the various departments working separately.
• Divisional A divisional structure typically is used in larger companies that operate in a wide geographic area or that have separate smaller organizations within the umbrella group to cover different types of products or market areas. The now-defunct Tecumseh Products Company was organized divisionally, with a small engine division, a compressor division, a parts division, and divisions for each geographic area to handle specific needs. The benefit of this structure is that needs can be met more rapidly and more specifically; however, communication is inhibited because employees in different divisions are not working together. Divisional structure is costly because of its size and scope. Small businesses can use a divisional structure on a smaller scale, having different offices in different parts of the city, for example, or assigning different sales teams to handle different geographic areas.
• Matrix The matrix structure is a hybrid of divisional and functional structure. Typically used in large multinational companies, the matrix structure allows for the benefits of functional and divisional structures to exist in one organization. This can create power struggles because most areas of the company will have a dual management—a functional manager and a product or divisional manager working at the same level and covering some of the same managerial territory.
EXAM TIP The advantage of functional departmentalization is that it promotes skill specialization; the disadvantages are that it reduces communication and cooperation between departments.
HR Policies and Procedures
Human resource policies are continuing guidelines on the approach the organization intends to adopt in managing its people. It represents specific guidelines to HR managers various matters concerning employment. HR policies provide the outline by which employees are likely to behave in the workplace. These policies are written statements of the company’s standards and objectives and include all areas of employment. They contain rules on how employees must perform their jobs and interact with each other.
EXAM TIP Human resource policies serve three major purposes: to reassure employees they will be treated fairly and objectively, to help managers make rapid and consistent decisions, and to give managers the confidence to resolve problems and defend their decisions.
ADA HR Policy
The duty to provide reasonable accommodation is a fundamental statutory requirement under the Americans with Disabilities Act (ADA), as amended by the Americans with Disabilities Act Amendments Act (ADAAA). The Rehabilitation Act has similar requirements applicable specifically to federal contractors. (See Chapter 2 for more ADA details.)
Title I of the ADA requires an employer to provide “reasonable accommodation” to qualified individuals with disabilities who are employees or applicants for employment—unless such accommodation would cause the employer an “undue hardship.” The law requires reasonable accommodations so that employees with disabilities can enjoy the “benefits and privileges of employment” equal to those enjoyed by similarly situated employees without disabilities. The ADAAA broadens the concept of disability under the ADA by statutorily rejecting Supreme Court decisions that took a narrower view.
To comply with the ADA and ADAAA, attain diversity goals, access a larger labor pool, and take advantage of tax incentives, most employers adopt a written policy with a formal, comprehensive approach to employing people with disabilities.
EEO HR Policy
Compliance with federal antidiscrimination laws requires covered employers to inform employees of their right to be free from workplace discrimination and retaliation. The Equal Employment Opportunity Commission (EEOC) under Title VII of the Civil Rights Act of 1964 requires employers to post workplace notices, and covered employers typically include a policy statement on equal employment opportunity (EEO) in employee handbooks and other sources of workplace policies distributed to employees. EEO policies also apply to vendors, contractors, and other third parties with whom the employer conducts business. Employers with government contracts or that receive government funding may have additional notice of rights requirements. State or local laws may expand the list of protected categories.
Progressive Discipline Policy
Progressive discipline generally includes a series of increasingly severe penalties for repeated offenses, typically beginning with counseling or a verbal warning. Progressive discipline policies can be a useful tool for warding off potential unionization in the nonunion setting, given that most unions typically point to unfair disciplinary actions to promote the benefits of unionization. Such procedures also help ensure uniformity and consistency in the administration of disciplinary action and thus minimize exposure to discrimination claims.
However, in states where an employee handbook or manual creates contractual or enforceable rights, the existence of a progressive discipline policy might be construed to require employers to follow that policy no matter the circumstances. Moreover, if a progressive discipline policy requires the employer to follow a series of steps before certain terminations occur, the policies may hinder an employer’s ability to take swift termination action.
When a progressive discipline system is used, it must be designed carefully, backed up by clear procedures and administered by well-trained supervisors.
Employee Handbooks and Policy Manuals
An employee handbook is an important communication tool between you and your employees. A well-written handbook sets forth your expectations for your employees and describes what they can expect from your company. It also should describe your legal obligations as an employer and your employees’ rights. This summary will help you write an employee handbook, which typically includes the following topics:
• Nondisclosure agreements (NDAs) and conflict-of-interest statements Although NDAs are not legally required, having employees sign NDAs and conflict-of-interest statements helps to protect your trade secrets and company proprietary information.
• Anti-discrimination policies As a business owner, you must comply with the equal employment opportunity laws prohibiting discrimination and harassment, including the Americans with Disabilities Act. Employee handbooks should include a section about these laws and how your employees are expected to comply.
• Compensation Clearly explain to your employees that your company will make required deductions for federal and state taxes, as well as voluntary deductions for the company’s benefits programs. In addition, you should outline your legal obligations regarding overtime pay, pay schedules, performance reviews, salary increases, time-keeping records, breaks, and bonuses.
• Workers’ compensation Clearly describe applicable employee rights and benefits as provided for under your workers’ compensation program.
• Work schedules Describe your company’s policies regarding work hours and schedules, attendance, punctuality, and reporting absences, along with guidelines for flexible schedules and telecommuting.
• Standards of conduct Document your expectations of how you want your employees to conduct themselves, including dress code and ethics. In addition, remind your employees of their legal obligations, especially if your business is engaged in an activity that is regulated by the government.
• General employment information Your employee handbook should include an overview of your business and general employment policies covering employment eligibility, job classifications, employee referrals, employee records, job postings, probationary periods, termination and resignation procedures, transfers and relocation, and union information, if applicable.
• Safety and security Describe your company’s policy for creating a safe and secure workplace, including compliance with the Occupational Safety and Health Administration’s laws that require employees to report all accidents, injuries, potential safety hazards, safety suggestions, and health- and safety-related issues to management.
Safety policies should also include your company’s policy regarding bad weather and hazardous community conditions.
Add your commitment to creating a secure work environment and your employee’s responsibility for abiding by all physical and information security policies, such as locking file cabinets or computers when not in use.
• Computers and technology Outline policies for appropriate computer and software use and steps employees should take to secure electronic information, especially any personal identifiable information you collect from your customers.
EXAM TIP Employers need to use caution in using employee handbooks to prohibit undesirable behavior, especially with respect to social media.
HR Metrics
HR metrics are measurements used to determine the value and effectiveness of HR initiatives, typically including such areas as turnover, training, return on human capital, costs of labor, and expenses per employee. To measure and determine the real cost of employee grievances, organizations should gather and store notes and records about employee complaints in a central location so that the time spent on each case—and the cost associated with that time—can be measured and minimized.
The following are five employee relations metrics you should be tracking:1
• Number of grievances per month, quarter, and year using a constant measure, such as the number of grievances per 100 or 1000 employees. This data can be “sliced and diced” by manager, department, region, and facility, she said.
• Cost of grievances by calculating—in a consistent manner over time—the time spent by managers, HR, and legal counsel investigating and handling complaints, the cost of lost productivity, and any legal expenses.
• Root cause of grievances. “Just like with safety and quality, if there’s a defect or issue we’ve got to figure out why,” she explained. In the case of employee grievances, she noted, such problems can arise as a result of supervisor errors, unclear policies and procedures, lack of management training, and bad hiring decisions.
• Average close time. Similar to “time to fill,” a measure used in recruiting, the average close time is a measure of the efficiency of the grievance resolution process that is based on how many days it takes to resolve an issue from the day it is identified as a problem.
• Return on investment (ROI). “Eventually we want to look at how much money—over time—the employee relations program has saved the organization,” she noted. Measures such as revenue per employee and profit per employee can be monitored to see whether there is any impact after effective grievance resolution processes are implemented.
Data Compilation Tools2
Historically, many organizations have built data storehouses of employee skills, knowledge, and capabilities by capturing data from employees using various checklists and then inputting the raw data or codes into databases. Unfortunately, most of these databases have had limited search and/or retrieval capabilities, and these data compilation efforts have been less than successful in matching employee skills and talent with company needs in a timely manner. So why not revise the process?
Technological innovations such as scanning, data mining, and enterprise-wide software now enable an organization to capture, cross-utilize, and retrieve information from diverse sources. Documents including résumés, employment applications, project management records, capability statements, workflow documents, department records, workforce forecasts, business development plans, performance appraisals, succession plans, and employee wish lists can be organized in the company’s data warehouse to aid in the identification of employee talent, skills, knowledge, and capabilities.
Once this veritable mother lode of data has been mined, it is amenable to being sorted, categorized, and assessed to meet organizational needs. The organization can then begin to build its own detailed histories of each employee’s relevant skills, knowledge, and capabilities, using the data in a format that is business friendly. Employees can attest to the accuracy of the data by including this as a step in the existing processes for performance appraisal and succession planning.
A far larger universe of information coupled with the organization’s development of its own business-driven histories of employee capabilities could result in a giant step forward in matching employee skills with business requirements.
Data mining and warehousing techniques can serve not only as a useful strategic tool in meeting business needs but also as a tool for enhancing task and team performance, recognizing talent capabilities and development, and furthering business development goals.
Data Collection Methods3
Determining what metrics to measure and report will depend on an organization’s strategy and goals. When high-level executives ask the HR team to start measuring the department’s performance, some HR staffers scramble to figure out what they should measure. Measurement just for the sake of providing statistics is never a good idea. As business writer Peter Drucker stated, “What gets measured gets managed,” so implementing an HR reporting system should be carefully planned.
A good approach is to focus on the metrics that affect progress toward business goals. However, assessing what data is meaningful, determining how to measure is, and choosing appropriate communication methods can seem daunting.
For help in choosing what HR metrics to focus on, HR professionals may want to consider the following:
• Review business strategy and both long- and short-term goals with C-suite executives to ensure HR is aligned with these objectives. Identify how HR will contribute to achieving those goals, and pinpoint which measurements will provide targeted, relevant information about how those functions affect business objectives and strategies.
• Define each HR metric and its formula. Not all organizations define metrics the same way or use the same formulas. For example, some companies measure the cost for each new hire without including payment for recruiters as a related expense. SHRM offers several calculators4 for commonly used metrics.
• Determine what data must be collected, what collection methods are available, and how the data will be gathered. For instance, will all data for cost-per-hire be captured in human resource information systems? Or will some data need to be obtained from another department?
• Decide how often HR metrics information will be collected and reported. Will it be monthly, quarterly, or annually?
• Choose what format will be used to report the data and who will receive the report. Will the data be part of a regular operations report or scorecard? Will it be a stand-alone document? Who will receive the report?
• Review what is being measured on a regular basis to ensure that HR is providing relevant information. Have goals changed? Does HR need to be providing different metrics to support business objectives?
EXAM TIP Reliability refers to the consistency of a measure; validity refers to whether the research effort actually measures what it is supposed to measure.
Surveys5,6
A carefully designed and conducted employee survey can reveal a great deal of information about employee perceptions that management can use to improve the workplace. Organization responsiveness to employee feedback leads to higher retention rates, lower absenteeism, improved productivity, better customer service, and higher employee morale. The simple fact that the organization is conducting a survey can send a positive message to employees that their opinions are valued. In addition, managers can gain insights into issues affecting their departments or business units that allow them to manage more effectively. Conversely, if the senior management team is not fully committed and ready to really listen to and, most important, act on what employees are saying, then conducting a survey can falsely raise expectations among employees, leading to an employee relations disaster.
The three most common types of employee surveys include employee opinion and satisfaction surveys, employee culture surveys, and employee engagement surveys.
• Employee opinion and satisfaction surveys measure employee views, attitudes, and perceptions of their organization (also known as climate surveys).
• An employee culture survey measures the point of view of employees and is designed to assess whether it aligns with that of the organization or its departments.
• Employee engagement surveys measure employees’ commitment, motivation, sense of purpose, and passion for their work and organization.
Interviews
Job analysis and evaluation, performance evaluation, and employment interviews are just some of the circumstances when data is collected by an interview method. Interviewing is a widely used data collection technique. Interviewing is an important step in the employee selection process. If done effectively, the interview enables the employer to determine whether an applicant’s skills, experience, and personality meet the job’s requirements. It also helps the employer assess whether an applicant would likely fit in with the corporate culture. In addition, preparing for an interview can help clarify a position’s responsibilities.
Moreover, to the extent that the interview process leads to the hiring of the most suitable candidate, it can help contain the organization’s long-term turnover costs. Applicants also benefit from an effective interview, as it enables them to determine whether their employment needs and interests would likely be met.
Observation7
A key advantage of conducting observations is that you can observe what people actually do or say, rather than what they say they do. People are not always willing to write their true views on a questionnaire or tell a stranger what they really think at an interview. Observations can be made in real-life situations, allowing the researcher access to the context and meaning surrounding what people say and do. There are numerous situations in the area of criminology and related disciplines where approaching people for an interview or questionnaire completion is unlikely to yield a positive response but where observations could yield valuable insights on an issue.
On the other hand, there are a number of important problems associated with observational research. An important one relates to the role of the observer and what effect the observer has on the people and situations observed. This is difficult to gauge. There is also the problem of being able to write an account, as a researcher, when one is immersed in a situation or culture. This latter situation can mean that the research is dismissed as too subjective. Observation can be time consuming. Some well-known observational pieces of research took some years of observation and immersion in a situation or culture. However, it is more common in modern research to reduce the observation time substantially. Observation time may be further reduced in experimental conditions (laboratory or simulation), in other words, controlled settings. An important potential disadvantage in conducting observational research is the ethical dilemmas inherent in observing real-life situations for research purposes.
Reporting and Presentation Techniques
There are many ways to present your data so that it can be easily understood by your stakeholders. No matter which reporting method you choose, simplicity will ensure that the results of your evaluation are both accessible and understandable.
There are two broad categories of reporting methods: those that are written (annual reports, fact sheets, etc.) and those that are oral/visual (PowerPoint presentations, exhibits, news release, etc.). No matter the reporting method you choose, the report should take into account your audience and be both accessible and understandable. In this section we will discuss the use of histograms and bar charts.
Histogram
A histogram or Pareto chart (sorted histogram) is a column chart that shows frequency data. Figure 3-1 is a typical example.
Figure 3-1 Histogram
To create a histogram in Excel, you can use the Histogram tool of the Analysis ToolPak. It uses two columns of data to create a histogram, one for data you want to analyze and one for bin numbers that represent the intervals by which you want to measure the frequency. The major difference is that a histogram is only used to plot the frequency of score occurrences in a continuous data set that has been divided into classes, called bins. Bar charts, on the other hand, can be used for a great deal of other types of variables including ordinal and nominal data sets.
Bar Chart
A bar chart or bar graph is a chart or graph that presents grouped data with rectangular bars, with lengths proportional to the values that they represent; Figure 3-2 shows an example. The bars can be plotted vertically or horizontally. Pie charts are best to use when you are trying to compare parts of a whole. They do not show changes over time. Bar graphs are used to compare things between different groups or to track changes over time.
Figure 3-2 Bar chart
EXAM TIP Bar charts compare variables by plotting categorical data, whereas pie charts show how categories make up parts of a whole.
Impact of Technology on Human Resources8
Rapid changes in technology have affected businesses in more ways than we can count, from globalization and organizational adjustments to a workforce clamoring for remote and mobile job opportunities, and human resources has had to adapt swiftly. If HR wants to continue to play a critical role in helping businesses anticipate and manage organizational change, it must have technology at its core.
With millennials making up more than half of the current workforce, and predicted to make up 75 percent by 2020, HR is going to have to embrace and build on technological advancements to meet both employee expectations and business requirements. Talent analytics and workplace analysis will become more commonplace, and companies using the data available to them will be far more competitive.
Compliance and risk avoidance are essential principles for HR, underlying every function and task. Because of this, HR has earned a reputation for being mired in time-consuming duties with significant amounts of paperwork.
But technology has changed much of that monotony via new HR portals and platforms that digitize much of the information HR needs to process. Today’s technology gives HR professionals access to the power of Big Data—impacting the way businesses understand their customers, market to new audiences, and communicate with existing and prospective employees.
EXAM TIP HR portals have the advantage of allowing employees to monitor their own personal information and other company resources from their own computers or other mobile devices.
When combined with other technologies, Big Data provides a tremendous amount of insight and allows HR professionals to make decisions backed by concrete information and more efficient processes.
• Big Data gives HR a fact-based view of the current workforce, identifying emerging trends so businesses can adapt.
• Predictive analytics allow for better risk-management decisions. For example, they can identify employees who could benefit from additional training or highlight teams that may be struggling.
• Analytics also allows recruiters to assess potential employees based on real information; by basing hiring decisions on facts instead of hunches, they can improve the quality and placement of new hires.
The cloud is another innovation that’s changing HR in a big way. Both collection and storage of data have always been a big part of HR’s function and, until the cloud, meant hard drive space, piles of paper, filing cabinets, and desk drawers. Naturally, this led to inefficiencies, security issues, data loss, and chaotic office spaces.
Today, all of this information can instead be stored in the cloud; documents and other pertinent information can be easily accessed online while data can be collected through simplified forms and automated processes. Employee information—like tax forms, payroll data, performance reviews, and contact information—can be archived and organized in one secure location.
Cloud-based systems and Big Data go hand in hand. All this data can provide valuable insight if you know how to interpret it, which has already made a tremendous impact on HR. However, in the future, HR’s challenge will include the need for higher levels of interpretation and broader application of the insights cloud-based systems and Big Data provide.
Cloud security makes it easy to limit access to information. At the same time, cloud-based mobile platforms allow individuals to access their information more readily than ever before.
Imagine if you didn’t need to e-mail HR every time you had a question about your benefits or paycheck; instead, you’d log on to a portal where all that information was at your fingertips. Imagine if you could use the same portal to request time off, change your mailing address, or confirm contributions to your 401(k).
Mobile HR apps make it easy for employees to access this kind of information anywhere and anytime. And that makes life easier for HR workers, too.
Despite the potential impact, many companies still haven’t made the switch to modern HR systems, but I think it’s only a matter of time. As we barrel into the future of technology in the workplace, HR has a lot to look forward to; cloud computing, easier storage, better insights, and greater transparency are only the beginning. Because of efficiencies, cost savings, employee expectations, and the power of Big Data for HR and organizations as a whole, technology is just too business critical to ignore.
Statutory Reporting Requirements
Federal laws and regulations typically include statutory recording and reporting requirements in their legislation. The following are a summary of these requirements for the Occupational Safety and Health Act (OSHA), the Employee Retirement Income Security Act (ERISA), and the Affordable Care Act (ACA).9
The Occupational Safety and Health Act (OSHA)10
The Occupational Safety and Health Administration (OSHA) is revising its rule addressing the recording and reporting of occupational injuries and illnesses (29 CFR parts 1904 and 1952), including the forms employers use to record those injuries and illnesses. The revisions to the final rule will produce more useful injury and illness records, collect better information about the incidence of occupational injuries and illnesses on a national basis, promote improved employee awareness and involvement in the recording and reporting of job-related injuries and illnesses, simplify the injury and illness recordkeeping system for employers, and permit increased use of computers and telecommunications technology for OSHA recordkeeping purposes.
The Employee Retirement Income Security Act (ERISA)11
The Reporting and Disclosure Guide for Employee Benefit Plans is prepared by the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) with assistance from the Pension Benefit Guaranty Corporation (PBGC). It is intended to be used as a quick reference tool for certain basic reporting and disclosure requirements under the Employee Retirement Income Security Act of 1974 (ERISA). Not all ERISA reporting and disclosure requirements are reflected in this guide. For example, the guide, as a general matter, does not focus on disclosures required by the Internal Revenue Code or the provisions of ERISA for which the Department of the Treasury and Internal Revenue Service (IRS) have regulatory and interpretive authority. For information on IRS notice and disclosure requirements, please visit the IRS web site at http://irs.gov/Retirement-Plans/Retirement-PlanReporting-and-Disclosure. The guide contains, on page 23, a list of EBSA and PBGC resources, including agency Internet sites, where laws, regulations, and other guidance are available on ERISA’s reporting and disclosure requirements.
The Affordable Care Act (ACA)12
Employers subject to the Affordable Care Act’s 2015 information reporting requirements were given extra time to give these forms to employees and file them with the government. In Notice 2016-4, issued by the IRS on December 28, the agency extended the information reporting due dates.
With transition relief ending, reporting deadlines for filings in 2017 will be months earlier than in 2016.
Subsequently, for year 2016 information filing, the IRS extended the deadline for furnishing forms to employees to March 2, 2017, but left the deadlines for filing forms with the IRS intact (February 28 for paper/mail submissions or March 31 for electronic filing).
Purpose and Function of Human Resources Information Systems (HRISs)
Effective and successful human resource management is required for a business to compete in the marketplace. HR managers coordinate a wide variety of employee management activities that involve large amounts of data over time. A human resource information system provides data management and accurate and timely information for decision-making; it also streamlines HR operational, managerial, and executive support processes.
A human resource information system functions as a productivity tool for HR operational processes. Increased speed and accuracy result when HR transactions are performed with computer software rather than manually, and routine transactions such as employee headcount, payroll tracking, and time and attendance reporting become automated and more cost effective. HR representatives enjoy increased productivity and accomplish more in their work week when manual processes take up less of their time.
An HRIS functions as a managerial information system to gather and provide key data about staffing, turnover, benefits, and regulatory compliance issues. Human resource personnel can provide reports on total number of employees, cost to hire, vacant positions, benefits costs, required reports such as EE03, and cost of raises and bonuses. HR managers can more easily present analysis of compensation, recruiting, accidents, and injuries.
A company’s HRIS functions as an executive information system to aggregate high-level data for long-range planning such as succession planning. The system provides executive planning information for strategic needs such as forecasting, staffing needs assessment, and employee skills assessment.
An HRIS also can function as an office automation system to design employee management documents such as applications and job requisitions, to schedule shared resources, and to schedule and track employee training and recognition. HR reports can be automated and set to run and distribute right from the system, getting information to the people who need it in real time. An HRIS reduces the amount of time the staff spends on daily transaction activities, such as tracking employee status changes, and frees them to work on more planning and strategy aligned with corporate goals.
Job Analysis Methods and Job Descriptions
Job analysis is a process to identify and determine in detail the particular job duties and requirements and the relative importance of these duties for a given job. Job analysis is a process where judgments are made about data collected on a job.
Legal Aspects of Job Analysis
An important concept of job analysis is that the analysis is conducted of the job, not the person. While job analysis data may be collected from incumbents through interviews or questionnaires, the product of the analysis is a description or specifications of the job, not a description of the person.
Job analysis can be used in selection procedures to legally identify or develop the following:
• Job duties that should be included in advertisements of vacant positions
• Appropriate salary level for the position to help determine what salary should be offered to a candidate
• Minimum requirements (education and/or experience) for screening applicants
• Interview questions
• Selection tests/instruments (e.g., written tests, oral tests, job simulations)
• Applicant appraisal/evaluation forms
• Orientation materials for applicants/new hires
Job Analysis and the ADA
With the passage of the Americans with Disabilities Act (1990), job analysis has taken on an increasing importance. A job analysis can be used to define the essential elements of the job, including the physical demands that the work requires. The ADA specifically states that no covered entity shall discriminate against a qualified individual with a disability because of the disability of such individual in regard to job application procedures; the hiring, advancement, or discharge of employees; employee compensation; job training; and other terms, conditions, and privileges of employment. The ADA requires that handicapped individuals be given “reasonable accommodation” in the workplace so that they will not be unreasonably excluded from employment. Job analysis is a process to identify the tasks and duties performed on the job as well as the equipment used. This information may be helpful in determining what “reasonable accommodations” could be made for an individual to perform the job.
Job Analysis and the FLSA
The FLSA requires that most employees in the United States be paid at least the federal minimum wage for all hours worked and overtime pay at 1.5 times the regular rate of pay for all hours worked more than 40 hours in a workweek.
The FLSA provides an exemption from both minimum wage and overtime pay for employees employed as bona fide executive, administrative, professional, and outside sales employees.
Job Analysis and Affirmative Action
On August 27, 2013, the Office of Federal Contract Compliance Programs (OFCCP) announced new rules outlining how federal contractors should handle their affirmative action and nondiscrimination obligations for protected veterans and for individuals with disabilities. The changes/new requirements include the following:
• Applying the “Internet applicant” rule to the new rules so that electronic applications and inquiries will be handled the same way they are handled for other groups covered by affirmative action (race, color, religion, sex, or national origin)
• Changing the 2-year recordkeeping requirement to 3 years
• Removing the requirement in the disabilities rule to review all physical and mental job qualification standards on an annual basis and replacing it with a requirement for contractors to establish their own schedule for reviewing job qualifications
• Requiring employers to achieve specific numeric goals to document compliance
• Requiring that contractors compare the number of individuals with disabilities (IWDs) who apply to the number of IWDs who are hired and keep those records for 3 years for audit purposes
• Maintaining an applicant flow log showing the name, race, sex, date of application, job title, interview status, and the action taken for all individuals applying for job opportunities
• Maintaining records pertaining to company compensation design and system
• Filing EEO-1 and VETS 4212 reports annually
Competency Analysis
Competency-based interviews are one form of competency analysis that is an effective means of screening candidates who qualify for the job by targeting the specific competencies required for the position. A skills analysis identifies the major responsibilities of a job and breaks down each major responsibility into its job skills or tasks. A full competency analysis or competency map also describes the subskills, supporting knowledge and abilities, attitudes and behaviors, and tools required to perform the job. Skills gap analyses can identify gaps in training programs and employees’ skills.
Job Descriptions and Job Specifications
Job descriptions describe a broad, general, and written statement of a specific job, based on the findings of a job analysis. It generally includes duties, purpose, responsibilities, scope, and working conditions of a job along with the job’s title and the name or designation of the person to whom the employee reports. A job specification is a statement of the essential components of a job class, including a summary of the work to be performed, the primary duties and responsibilities, and the minimum qualifications and requirements necessary to perform the essential functions of the job.
Job Description Components
A job description need not account for every task that might ever be done. Here are the most critical components of a good job description:
• Heading information This should include job title, pay grade or range, reporting relationship (by position, not individual), hours or shifts, and the likelihood of overtime or weekend work.
• Summary objective of the job List the general responsibilities and descriptions of key tasks and their purpose; relationships with customers, co-workers, and others; and the results expected of incumbent employees.
• Qualifications State the education, experience, training, and technical skills necessary for entry into this job.
• Special demands This should include any extraordinary conditions applicable to the job (for example, heavy lifting, exposure to temperature extremes, prolonged standing, or travel).
• Job duties and responsibilities It’s more important to list what must be performed and accomplished than how, if there is more than one way to do it. Being too specific on how to accomplish a duty could lead to ADA issues when an employee asks for an accommodation.
Why Use Job Descriptions
The following are reasons job descriptions are important:
• It ensures that you’re hiring the right people to fill the right position.
• Writing concise and effective job descriptions is a crucial component for setting your organization apart from the competition in order to attract the best candidate.
• Well-written and effectively developed job descriptions are communication tools that allow both employees and candidates to clearly understand the expectations of the role, its essential duties, the competences and responsibilities, and the required educational credentials and experience.
• As individual roles change over time, the job descriptions should change with them. There are few positions that do not evolve. Most change. Systems and processes evolve. The job descriptions should be continually updated as the duties change over time. The job description needs to evolve and continue to be correctly classified.
FLSA Job Classifications
The U.S. Department of Labor divides jobs into two categories, exempt or nonexempt. Employees whose jobs are governed by the FLSA are classified as either exempt or nonexempt. Nonexempt employees are entitled to overtime pay. Some jobs are classified as exempt by definition. For example, executive employees are exempt. These employees are not protected by the Fair Labor Standards Act (FLSA).
Exempt
The FLSA provides an exemption from both minimum wage and overtime pay for employees employed as bona fide executive, administrative, professional, and outside sales employees. Section 13(a)(1) and Section 13(a)(17) also exempt certain computer employees. To qualify for exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week. Job titles do not determine exempt status. For an exemption to apply, an employee’s specific job duties and salary must meet all the requirements of the department’s regulations.
Nonexempt
Most employees are entitled to overtime pay under the Fair Labor Standards Act. They are called nonexempt employees. Employers must pay them 1.5 times their regular rate of pay when they work more than 40 hours in a week.
Independent Contractors
For the FLSA’s minimum wage and overtime provisions to apply to a worker, the worker must be an “employee” of the employer, meaning that an employment relationship must exist between the worker and the employer. The FLSA defines “employ” as including to “suffer or permit to work,” representing the broadest definition of employment under the law because it covers work that the employer directs or allows to take place. Applying the FLSA’s definition, workers who are economically dependent on the business of the employer, regardless of skill level, are considered to be employees, and most workers are employees. On the other hand, independent contractors are workers with economic independence who are in business for themselves.
External HR Service Providers
Small and midsize companies are increasingly looking to outsource HR functions to focus on core operations and growing the business. Companies have been moving that way as HR has become more complex; it’s no longer an HR person sitting in an office planning social events. There are complicated employee and compliance issues to address. Besides HR consultants who are third-party service providers, today’s marketplace also includes recruiting firms, benefits brokers, and staffing agencies. Each is described more in the following sections.
Recruiting Firms
Recruiting firms are a type of company that recruits new talent for open positions in the workforce. For example, if there is an open position for an accountant and they have an accountant in their database, they will set that person up with an interview for the company hiring.
Staffing Agencies
A staffing agency, also called a temp agency, can help bridge the gap for people stuck between jobs or for businesses that need to fill out the ranks but are having difficulty finding qualified employees. A temp agency has an army of workers with a variety of skills at its disposal.
Benefits Brokers
A health insurance broker’s job is to provide clients with the most appropriate health insurance policy. Authorized by specific insurance companies to act on their behalf, the broker essentially guides clients through the process of selecting a policy for themselves or for employees.
Communication Techniques
Communication skills are critical in all walks of life, but communicating effectively in the workplace is critical to professional success. Whether interacting with colleagues, subordinates, managers, customers, or vendors, the ability to communicate effectively using a variety of tools is essential.
Workplace communication is the process of exchanging information, both verbal and nonverbal, within an organization. An organization may consist of employees from different parts of the society. They may have different cultures and backgrounds and can be used to different norms. To unite activities of all employees and restrain from any missed deadline or activity that could affect the company negatively, communication is crucial. Effective workplace communication ensures that all the organizational objectives are achieved. Workplace communication is tremendously important to organizations because it increases productivity and efficiency. Ineffective workplace communication leads to communication gaps between employees, which causes confusion, wastes time, and reduces productivity.
Effective communication with clients plays a vital role in the development of an organization and the success of any business. When communicating, nonverbal communication must also be taken into consideration. How a person delivers a message has a lot of influence on the meaning of this one.
Tips for e-mail etiquette include the following:
• Start on a personal note.
• Tame the emotions.
• Keep it short and sweet.
• Read it twice.
• If it’s a critical e-mail, do not under any circumstances send it right away.
• Master the subject line.
Chapter Review
This chapter is as multifaceted as its heading, HR Operations. It started with a brief review of employee relations in the workplace and briefly reviewed some laws and regulations particularly important as you address HR functions in an employee relations environment.
After employee relations, the chapter covered other basic HR functions such as staffing; compensation and benefits; training and development; and health, safety, and security. Along the way, we talked about records management.
You also learned about the type of work typically done by HR generalists and specialists. In fact, the chapter covered the whole HR support system, including career development options and opportunities.
You spent time examining organizational accountability as well as organizational strategy, finally reviewing the role of organizational culture in the workplace. This led to an examination of traditions and unwritten procedures. Confidentiality and privacy were covered next.
Then the chapter covered business functions as well as organizational structure and examined the role and importance of well-drafted employee handbooks and policy manuals. This led to a look at data collection methods, reporting and presentation techniques, and an examination of the impact that technology plays in our daily HR activities.
The chapter examined the function of an HRIS and its impact in all aspects of our HR functions. Before closing this chapter, we examined the legal aspects of job analysis, distinguishing job analysis from job specifications.
Finally, our travels through this varied and complex world ended with a brief look at third-party HR services and closed with a look at various communications techniques and some e-mail tips.
Questions
1. HR metrics are measurements used to determine:
A. The amount of supplies such as pencils and printer toner to order
B. How many Disneyland discount tickets to arrange
C. The value and effectiveness of HR performance such as turnover, training, return on human capital, and expenses per employee
D. The annual holiday party budget
2. Benjamin is the only HR professional working for an engineering firm with 55 employees. For Benjamin to be effective in his solo practitioner role, it is important for Benjamin to:
A. Read about the latest HR and employment law trends
B. Submit budget requests each year justifying a request for more HR staff
C. Get at least 8 hours of sleep a night because of his job’s stress
D. Become a member of a professional association
3. Progressive discipline policies generally involve multiple levels of:
A. Management approval before a warning is possible
B. Increasingly severe disciplinary action
C. Employee appeal before disciplinary action
D. Supervisory explanation before approval of a warning
4. The ADA was amended in 2008 to:
A. Make it more difficult to claim a disability
B. Make the ADA different from the Rehabilitation Act
C. Broaden the concept of disability under the ADA by statutorily rejecting Supreme Court decisions that took a narrower view
D. Give placement privileges to disabled people
5. Thea just joined the HR Operations team at a new plastic molding company. Her job refers to services provided by:
A. An HR department to the organization’s operations
B. An HR department to the senior executives
C. An HR department to outside vendors
D. An HR department to retirees
6. Today, HR staff exists in not just large and mega organizations but also in smaller organizations such as an engineering or law firm. In smaller organizations, it is not uncommon to:
A. Have a one-person HR department handling all HR functions
B. Pay someone in operations to be sure posters are current
C. Take delivery of all inventory materials
D. Give each line manager authority to modify HR policies
7. The field of HR has changed significantly over the past 50 years. In the 1960s, HR practitioners were primarily known as:
A. Payroll coordinators
B. Strategic business partners
C. Industrial relations specialists
D. Party planners
8. The roles and functions of HR today are vastly different from 50 years ago. Today HR functions include:
A. Party planning
B. Transformational and transactional HR
C. Legal advice and counsel
D. Assurance that all posters are no more than a year old
9. Leslie has been promoted to the HR Operations team for her company. Her job role will involve compliance with laws including:
A. Equal and fair housing
B. Dental administration and support
C. Equal opportunity and affirmative action
D. Healthy menu planning for employers
10. Some of the functions of an HR department are:
A. Payroll and accounting reconciliation
B. Vendor contract management
C. Legal advice and counsel
D. Personnel sourcing, hiring, and training
11. A task is:
A. Something assigned by the CEO
B. Almost always aligned with production management
C. Typically a unit of work, meaning a set of activities needed to produce some result
D. Always different from day to day
12. Phillipe is part of a new initiative that his HR department has embarked on, which is to update all existing employees’ job descriptions. Job descriptions are:
A. Legally binding parameters limiting work to be done
B. Used to describe a job and include lists of the general tasks and functions
C. Documents that determine the limits of an employee’s expectations
D. Required only when a union represents the work group
13. Employment is defined as:
A. An agreement between an employer and an employee that the employee will provide certain services
B. An agreement that is usually in writing or under union contract
C. A loose arrangement that someone will perform contracted tasks
D. Whatever state and federal law define for each job requirement
14. Occupational health is:
A. Using the most current scientific techniques to maintain employee attendance
B. An ultimate, unrealistic objective set by the government
C. Unrelated to personal health
D. A focus on the prevention of hazards in the workplace
15. HR certifications are:
A. Going to be required by all employers in 10 years by federal law
B. Offered through testing by HRCI and SHRM
C. Given no extra weight in employment decisions
D. Given credit toward an advanced degree
16. Organizational culture is:
A. Something defined by consensus among department leaders
B. Composed of shared assumptions, values, and beliefs that govern how people behave
C. Strategic determination about the board of directors’ objectives
D. Something that can lower the cost of organizational insurance
17. Michelle has just accepted her first HR job working for a company that has been known for its long-standing traditions. Traditions in an organization are usually:
A. Mandatory methods of performing
B. Protocols for management team members
C. Fallback treatment of employee behavior issues
D. Beliefs or stories relating to the past that are commonly accepted
18. Inherent in the role of HR are confidentiality and privacy. While confidentiality is an ethical duty, privacy is:
A. A guarantee that employers must make to employees
B. A right rooted in common law
C. Never an issue in American workplaces
D. A professional obligation of all certified professionals
19. Carmine’s company has recently engaged the services of a consultant to help his company select a new HRIS system. Carmine has been asked to provide the fields that will contain personal data. Those fields for personal data can include:
A. Retinal scans, Social Security numbers, home address
B. Medical insurance plan content, compensation ranges, attendance score
C. Food preferences, day-off preferences, corporate insurance plan content
D. Parking space assignment, company savings plan offerings, exempt status
20. The two broad categories of reporting methods are:
A. Radio and Internet
B. Senior executive and first-level supervisor
C. Written and oral/visual
D. Government and private sector
21. A statement that describes what the organization does and its customer base is a:
A. Vision statement
B. Statement of position
C. Lofty statement
D. Mission statement
22. Taylor is the Quality Assurance director at her organization and reports to both the Division VP at her facility and the VP of Quality Assurance located at the headquarters office. This is an example of what type of organizational structure?
A. Span of control
B. Formalized
C. Matrix
D. Chain of command
23. The statement “We aspire to be a great place to work for all employees” is an example of:
A. A values statement
B. A vision statement
C. A mission statement
D. A core competency
24. According to the FLSA, which of the following would be considered time worked for the purposes of overtime?
A. A nonexempt employee spends 10 minutes at the end of the day cleaning up the work area.
B. A nonexempt employee is given a meal break of 45 minutes when working additional hours in the evening.
C. An exempt employee spends an hour traveling to and from the airport for a 1-day trip.
D. A nonexempt employee travels from home to a client site after hours in response to an emergency call.
25. A candidate’s ability to complete an actual job task is best tested through a(n):
A. Predictive index
B. Work sample test
C. Aptitude test
D. Achievement test
26. Which type of organizational structure would be most effective for maintaining centralized authority and accountability of specialized departments?
A. Line and staff
B. Functional
C. Divisional
D. Matrix
27. For which of the following groups does the short test that determines exempt or nonexempt status contain no criteria related to salary?
A. Executives
B. Professionals
C. Administrative employees
D. Outside salespeople
28. Under OSHA, employees do not have the right to:
A. Request OSHA inspections if violations exist in the workplace
B. Accompany the OSHA compliance officer on an inspection
C. Apply to OSHA for a temporary variance from a safety standard
D. Receive training and information on workplace health and safety standards
29. An HR professional has been assigned to communicate specific policies and procedures to line managers on how to deal with employee grievances. Which of the following HR roles does this task represent?
A. Advisory
B. Evaluation
C. Control
D. Service
Answers
1. C. Measuring HR initiative impact on the business is the purpose of metrics.
2. A. Staying current on HR and employment law trends is crucial to keeping employment organizations in compliance and functioning properly.
3. B. Beginning with oral warnings and moving through written warnings, final warning, and dismissal, progressive discipline has increasing levels of severity.
4. C. Congress made it easier to identify as disabled when it expanded the ADA to include things the Supreme Court had said would not qualify.
5. A. It covers a wide range of services, including administrative services, recruitment, employee relations, legal compliance, policy development, compensation and benefits, and training.
6. A. In small organizations, HR generalists are common. They handle multiple HR functions.
7. C. The catchall category of industrial relations specialists meant those people were negotiating terms and conditions of work.
8. B. They include delivering strategy and change and dealing with a wide range of administrative and operational tasks in support of the organization.
9. C. The three major legal compliance domains are equal opportunity, affirmative action, and sexual harassment.
10. D. HR department functions include personnel sourcing, hiring, training, skill development, benefits administration, and compliance with applicable national regional and local laws.
11. C. Tasks are typically defined as a unit of work, producing some result. A collection of tasks is sometimes referred to as a function.
12. B. Job descriptions list general tasks, functions, and responsibilities of a position.
13. A. Employment represents an agreement between the employer and employee that certain services will be performed by the employee.
14. D. The World Health Organization defines occupational health as dealing with all aspects of health and safety in the workplace.
15. B. Both the Human Resources Certification Institute (HRCI) and the Society for Human Resource Management (SHRM) offer HR certification programs through testing.
16. B. These shared values have a strong influence on the people in the organization and govern how they dress and perform their jobs.
17. D. Customary patterns of thought, action, or behavior produce organizational traditions and are accepted as operating preferences.
18. B. Common law brings privacy rights to employers and employees alike.
19. A. Personal data can include biometrics data such as retinal scans, fingerprints, DNA, and, of course, Social Security numbers and home addresses.
20. C. Written reports and fact sheets are one category. PowerPoint presentations, exhibits, and news releases are another. The two categories are written and oral/visual.
21. D. A mission statement contains a description of both organizational products/ services and the customer base for which it exists.
22. C. When the organization calls for reporting to two or more supervisors, the organization is known as a matrix organization.
23. B. A vision statement is an aspirational statement that answers the questions of what the company does, who for, and what the company aspires to be in the future.
24. D. A nonexempt employee called back to work is paid for the time spent getting to the job and handling the emergency.
25. B. A work sample test requires candidates to complete an actual work task in a controlled setting. The other tests measure a person’s general capacity to learn or ability to relate to others.
26. B. Functional organizations are centralized and have specialized departments such as finance, marketing, HR, and manufacturing.
27. D. For executives, administrative employees, and professionals, there is a $455 per week salary requirement.
28. C. Employees do not have the right to apply for relief from any of the OSHA standards, but they do have the right to any of the other options.
29. A. In an advisory role, HR trains line managers in the management of human resources.
Endnotes
1. Penny C Wofford, South Carolina Supreme Court Certified Specialist in Employment and Labor Law, Ogletree Deakins
2. https://www.shrm.org/hr-today/news/hr-magazine/pages/0107hrsolutions.aspx
3. https://www.shrm.org/resourcesandtools/tools-and-samples/hr-qa/pages/metricsmosthelpful.aspx
4. https://www.shrm.org/ResourcesAndTools/tools-and-samples/Pages/Spreadsheets.aspx
5. https://www.shrm.org/resourcesandtools/tools-and-samples/toolkits/pages/managingemployeesurveys.aspx
6. Additional information addressing the use of surveys can be found in Chapter 7.
7. http://compass.port.ac.uk/UoP/file/664e8001-f121-4e5d-aa06-6c95c797e8af/1/Observations_IMSLRN.zip/page_04.htm
8. http://www.huffingtonpost.com/meghan-m-biro-/the-impact-of-technology-_1_b_9294208.html
9. The ACA is under review by Congress with the stated purpose by the House and Senate to pass new legislation to replace the ACA. We recommend you carefully update yourself on the current status of the ACA before coming to a conclusion regarding the current status of this legislation.
10. https://www.osha.gov/pls/oshaweb/owadisp.show_document?p_id=16312&p_table=FEDERAL_REGISTER
11. https://www.dol.gov/sites/default/files/ebsa/about-ebsa/our-activities/resource-center/publications/rdguide.pdf
12. https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/aca-reporting-tips.aspx